Friday, 25 October 2013

This winter the government, emergency services and health workers will be on high alert as fuel prices rise inexorably upwards against diminishing household budgets. The last few weeks has seen a slew of price hikes by major power companies just in time for the winter months, which will force more and more households into a choice of food on the table or heating and hot water. Winter deaths are becoming an uncomfortable statistic, while there are always years where there are spikes in mortality rates due to flu/virus outbreaks such last year, the general trend is still high in what should be a post-industrial, technology and resource rich society.
Our inflation rate (2.7%) still exceeds our wage growth rate (1.4%) and bear in mind energy is excluded from our inflation rates, so price hikes in energy of over 10% are directly felt by consumers whose living standards are still falling, not rising.
So how have we allowed the post-privatisation era of the energy industry to become a contributor to our winter mortality rates, surely free market competition and regulation should bring prices down, not push them up? This article in the Wall Street Journal highlights the problems in the UK energy market. Perhaps one solution to is to regulate the shareholders dividend, and indeed, whether shareholders are entitled to profit from companies whose cash flow is at the expense of the most vulnerable in our society. Or perhaps the question we should be asking in this new(ish) century is whether energy, like water is a basic human right or a commodity to be traded, whatever the cost?